German Lessons for Great Britain on European Workers

It is not too late for the United Kingdom to learn from other EU member-states that with stricter labor market rules and better job training, there is nothing to fear from immigration.

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German Chancellor Angela Merkel and British Prime Minister Theresa May on July 10, 2018

One of the knottiest problems for British politicians struggling with Brexit is their insistence, as much by Labour as by the Conservatives, that Britain has to set up a giant new immigration bureaucracy to issue work and residence permits for any European citizen who is offered a job in Britain.

Undoubtedly, the main factor in swinging the Brexit vote was that it gave white English men and women their chance to vote against immigrants. Fifty years ago, a racist but very senior Tory politician, Enoch Powell, said Britain was “mad, literally mad, as a nation” to allow immigrants into the country.

Powellism sunk deep roots very fast, even if it was repudiated by the party leaders of the day. Powell was also hostile to Britain joining the European Community. That fusion of two English phobias—against immigration and against Europe—never went away. After 2000, as the Conservatives sought to undermine the pro-European Tony Blair, they unleashed, with the help of other anti-immigrant, anti-EU parties like UKIP and the British National Party, forces that culminated in Brexit when a majority of white middle-class as much as working-class people living in England voted to finally to stop immigration.

It is modish to believe that German Chancellor Angela Merkel’s 2015 decision to let in one million refugees fleeing murderous conflicts, oppression, and poverty in the Middle East and North Africa was to blame for Brexit and the rise of Europe’s new nationalist, anti-immigrant right represented by Poland’s Viktor Orbán in Hungary or Jarosław Kaczysńki in Poland. Orbán was first prime minister in 1998 and Kaczynski in 2006, long before recent waves of immigrants. The anti-immigrant Jean-Marie Le Pen defeated the French socialist Lionel Jospin in 2002 to go into the second round of the French presidential election.

Xenophobic politics, including in part the Brexit result, is caused by xenophobic politicians. In 2008, the Federation of Poles of Great Britain published a dossier of 50 hateful headlines by the Daily Mail. The pro-Brexit paper depicted Poles in much the same way the same paper described Jews in 1930—unwanted crooks and scroungers who had no place in Britain.

Xenophobic anti-immigrant votes piled up well before 2015. In a book published in January 2015, I predicted Britain would vote for Brexit. Anyone who spent five minutes outside the liberal, bien-pensant, Europhile salons of London or Oxford knew the success of populist politicians in creating hostility against immigrants.

Some blame the U.K. government decision of 2004 not to impose tough restrictions on workers from the eight new EU member states of Eastern Europe. Jochen Bittner, political editor of the German weekly Die Zeit, recently argued in The New York Times that Merkel’s refugee decision was to blame for Brexit. The images of refugee queues surely did not help, but the passions that led to Brexit were in place long before 2015.

There were already hundreds of thousands of Poles and other citizens from ex-communist countries working in Britain. It seemed more sensible to let them work legally rather than having them work in the unofficial cash-in-hand labor market. In fact, Germany’s 2004 Zuwanderungsgesetz (Immigration Law) allowed exemptions for employers to hire EU workers. For Britain, accepting EU citizens worked in the sense that European immigrant workers made a massive net contribution to Britain fiscal receipts, with 25 billion pounds annually coming into government finances. A study just published shows that a European immigrant worker pays 440 pounds more in taxes than their English equivalent.

Today, 1.7 million Poles living and working in Germany, and a total of 6.1 million EU citizens. These are twice the figures of Poles and other EU citizens living and working in Britain, so the argument that Germany slowed down arrivals from Europe in comparison with more liberal Britain after 2004 doesn’t hold up.

Where Britain did go wrong was not to copy Germany and other EU member-states in managing these new arrivals. When David Cameron pleaded with Merkel to stop the arrival of Europeans in Britain because they were putting pressure on housing, schools, and health services, she asked him to send a list of how many EU citizens there were and where these problems could be examined.

Berlin is still waiting, because neither Cameron nor his successor knows how many EU citizens are in Britain. In 2010, then-Home Secretary Theresa May abolished an embryonic identity card system, and then the EU worker-registration system that allows all other EU member-states to count the numbers accurately.

The European Union’s so-called freedom-of-movement rules do not apply to state employment. Yet the biggest employer of EU citizens in Britain is the state-run National Health Service. Britain could train its own doctors and nurses, but prefers to import them from abroad.

Britain has the worst apprenticeship schemes in Europe, so employers who need skilled craft workers like electricians, IT specialists, plumbers, heating engineers, and even bricklayers and carpenters had to recruit from Europe, as there were no such skilled workers coming into the labor market from within Britain.

Employment agencies acting as gang masters brought in Eastern European workers and rented them out to local British employers at extremely low wages. This was illegal under EU law, but British government officials turned a blind eye to these practices in order to maintain a flow of docile, low-wage workers for British firms.

Other European countries like Germany had much tougher internal labor market rules, gave trade unions a voice with employers on hiring workers from outside Germany, had proper apprenticeship training systems, educated more nationals to be health-service workers, and insisted every European worker was registered with an identity card.

Merkel might have suggested to Blair, Gordon Brown, Cameron, and now Theresa May that if Britain copied much stricter management of internal labor markets and promoted training and jobs for local workers, the kind of anti-immigrant tensions that culminated in Brexit might have been avoided. But it was not up to Merkel to teach, and British prime ministers refused to learn from the continent’s best practices in terms of labor market rules and support for local workers.

It is not too late. London could take the best measures from other EU member-states and show that labor mobility adds value and that there is nothing to be feared from immigration. After all, in Europe’s richest nation, Switzerland, 26 percent of the population is foreign-born.